Having eased from eight-day highs, bitcoin (BTC) worth might be in for a minor bout of consolidation, earlier than additional upside unfolds.
The cryptocurrency rose to $6,596 earlier as we speak on Bitfinex – the best degree since Sep. 6 – including credence to the short-term bullish reversal signaled by the symmetrical triangle breakout earlier this week.
However, regardless of the strengthening bullish case, the corrective rally has stalled. At press time, BTC is altering fingers at $6,450, having printed an intraday low of $6,355 a couple of minutes in the past.
While the sudden worth pullback may pressure traders to query the sustainability of the corrective rally, the short-term technical charts proceed to point out that the trail of least resistance is on the upper aspect.
BTC’s retreat from the highs close to $6,600 is probably going related to the bearish divergence of the relative energy index seen within the hourly chart.
Indeed, the RSI has adopted a bearish bias, nonetheless, it’s untimely to name an finish of the technical restoration, as the most important transferring averages (MAs) – 50-hour, 100-hour, and 200-hour – are trending north in favor of the bulls.
More importantly, the important thing MAs are capping the draw back as of writing. This leaves scope intact for a restoration to resistance at $6,800 (a number of every day highs).
Over on the every day chart, BTC closed (as per UTC) above the 10-day MA yesterday, neutralizing the bearish view put ahead by the rising wedge breakdown on Sep. 5.
However, the short-term MA continues to be sloping downwards. This, coupled with the bearish RSI divergence on the hourly chart may preserve the cryptocurrency vary sure for the following 24 hours or so.
That argument has advantage because the technical restoration often gathers velocity after short-term MAs backside out – until after all there’s a main optimistic basic information.
- BTC has retreated from eight-day highs, however the technical restoration continues to be intact.
- The cryptocurrency may consolidate round $6,400 within the subsequent few hours earlier than resuming the journey in direction of $6,800.
- A UTC shut beneath the trendline connecting the June low and Aug. 11 low would put the main target again on the rising wedge breakdown witnessed earlier this month and will yield a drop beneath $6,000 (February low).
Disclosure: The writer holds no cryptocurrency property on the time of writing.
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Original article first appeared in https://www.coindesk.com/bitcoin-price-takes-a-200-tumble-after-eight-day-highs/